Capital Investment - High yields across six postcodes in Edinburgh

Edinburgh-based property portal ESPC has revealed the city’s top-performing postcodes for rental yields in the last quarter of 2023.

The latest rental data from Citylets, combined with the most recent house price information from ESPC, shows that there were six postcodes in Edinburgh that offered the best rental yields for buy to let investors during the three months of October-December 2023, and one additional area that provided the highest yield across the capital.

Properties in the city centre performed especially well, with the postcode areas of EH1 and EH3 reporting strong figures. Properties in EH1 saw one-bed homes offering a rental yield of 6.2 per cent while two-bedroom properties reported an average yield of 6.3 per cent.

Similarly, homes in the sought-after EH3 district offered strong results, as increasing numbers of young professionals and families alike sought rental properties in the highly desirable New Town. One-bedroom properties in EH3 achieved an average rental yield of 6.9 per cent during October-December 2023, while two-bedroom properties offered a yield of 6.4 per cent. Larger three-bedroom homes had an average rental yield of 6.6 per cent.

Homes in the fashionable EH6 postcode also performed strongly, with properties here proving popular with a range of renters. Covering Leith, EH6 appeals to a broad range of tenants with its amenities, as well as its better-than-ever transport links thanks to the tram extension. 

One-beds in EH6 offered a rental yield of 6.3 per cent while two-beds and three-beds in the area both offered average yields of 6.1 per cent.

EH8 was also a solid option for investors, as this postcode reported good results during the last quarter of 2023. Spanning areas such as Newington, Duddingston, Abbeyhill and Willowbrae, this area appeals to tenants from students to young professionals and families. One-bedroom properties in this location provided a rental yield of 6.5 per cent while two-bedroom homes offered a 6.3 per cent yield.

Homes in the EH12 postcode performed effectively during the final months of 2023, with properties here proving popular with a range of renters. Located to the west of the city centre, and covering neighbourhoods such as Corstorphine, Murrayfield, Hermiston and Saughtonhall, this postcode offers a variety of homes suited to students, young professionals and families.

In this postcode, one-bedroom properties offered an average gross rental yield of 6.4 per cent while two-bedroom homes had a yield of 6.7 per cent.

ESPC says the postcode area of EH14 offers an ideal investment opportunity for landlords, with this part of the city continuing to be hugely popular with families and young professionals alike. Spanning areas such as Craiglockhart, Baberton, Slateford, Currie and Balerno, EH14 offers the chance to enjoy a more peaceful way of living, with the city centre still close at hand, and a reputation for great amenities, schooling and transport links. 

One-bedroom homes in EH14 offered a rental yield of 6.9 per cent during this period, while two-bedroom homes in the area provided an average yield of 6.2 per cent.

A special mention should be made for one-bedroom properties in the EH15 postcode area, which offered the highest rental yield in Edinburgh, at 7.1 per cent on average. EH15 covers Portobello, Brunstane, Duddingston and Joppa: well-known for being among the most popular places to live in the Capital.

Nicky Lloyd, Head of ESPC Lettings, says: “Throughout 2023, Edinburgh’s rental market continued to feel the effects of staggering levels of demand, with many more renters looking for properties than were available on the market. We did start to see a return to seasonal patterns, with the market feeling slightly quieter during the last months of 2023, but rents continued to rise and demand did not tail off.

“Properties of all sizes were high in demand, but one- and two-bedroom properties were especially popular during this time, suggesting a large number of students and young professionals were in the market for a rental property. Average rents are at an all-time high in Edinburgh, and competition continues to be fierce for quality homes, in many areas across the city.”